Sioux Falls construction reflects prosperity

South Dakota State Roundup

Published July 1, 1991  | July 1991 issue

Sioux Falls is well on its way to setting a record in 1991 for new construction.

By mid-May the city issued permits for construction projects totaling $65 million, well ahead of the previous record pace in 1989, when $35 million was spent during the same time period, and when construction projects totaled $140 million for the year.

Most recently, permits were issued for a $15 million medical clinic and $7 million adjacent parking facility. And, in the first five months of this year, construction of about 600 housing units was approved by the city, in contrast to about 225 units for the same period last year. (Construction figures include single- and multi-family structures and mobile homes.) Roughly 250 of these new units are mobile homes, 200 more than for the same period last year. "People are moving into mobile homes while they wait for more permanent housing units to be built," says Steve Metli, director of Planning and Building Services in Sioux Falls.

Metli cites two main reasons for this unprecedented growth: continued strong economic development in the medical sector and increased residential construction, which reflects a decline in interest rates.

Dan Scott, vice president of the Sioux Falls Development Foundation Inc., adds that a $1.9 million national marketing campaign in 1987 has also helped draw more people and jobs to the area.

With a population rise of nearly 24 percent from 1980 to 1990 and 2,000 new jobs created annually over the last five years, all this new construction doesn't surprise Metli. But he points to a turnaround in focus: Until 1988, Sioux Falls averaged about $60 million per year in permits with 60 percent for housing and 40 percent for economic development projects. Now it's 60 percent for economic development and 40 percent for housing.

Sioux Falls, the state's most populous city at about 101,000, has enjoyed continued growth during the recession, Scott says. "What makes us unique is that we've been able to maintain growth—the entire economy hasn't seen a downturn."

Nonetheless, all this prosperity is creating such a demand for workers that many construction companies and contractors raised their base wage more than $1 per hour this summer, Metli says. "If you want a job in Sioux Falls, there's no reason not to have one."

Kathy Cobb